Legislative Wrap-Up 2022: Bars, gyms and exercise studios get added protection as tenants

Brief amendments to the Retail Leases Act 1994 (NSW) (the Act) came into effect on 1 January 2023, expanding the current list of businesses covered by Schedule 1 of the Act to include various health and fitness businesses, and bars with a maximum capacity of 120 people. These definitions in the Act were broadened following recommendations from the NSW Small Business Commission, aiming to keep up with the emergence of these two rapidly growing industries.

What businesses have been included?

The Retail Leases Regulation 2022 (NSW) (the Regulation) extends to ensure health and fitness businesses such as gyms, fitness centres, and yoga, pilates, and dance studios that are found outside of retail shopping centres are now protected by the Act. Previously, only those located within retail centres were protected. Any free-standing health centres, or those located in shopping strips, were not.

Similarly, small bars were previously not afforded protection under the Act. The Regulation amended Schedule 1 to include ‘Small bars with a maximum patron capacity of 120 people’. As well as this, the Regulation removes ‘except where goods are for consumption on the premises’ from after ‘beer, wine, and spirit shops’, allowing places such as wineries and breweries to be treated as retail leases.

The Regulation also aims to increase access to the avenues of mediation under Part 8 Division 2 to apply to these new retail leases, where a lease commenced or an option lease was granted before the commencement of this Regulation, thereby keeping more people out of court and out of conflict.